Digital transformation is the new buzz phrase across many industries, including financial services. And while optimizing consumers’ experience should be the focus of digital transformation, a successful strategy isn’t one-size-fits-all. It’s important for credit union leaders to recognize that different consumer segments have different needs and wants when it comes to their use of digital tools.

A new eMarketer study, U.S. Hispanics and Digital, reveals some of the unique digital characteristics of the Hispanic consumer segment. According to the study, the Hispanic “digital divide” has mostly closed, with about eight in 10 Hispanics now using the Internet.

However, fewer than half of Hispanics have home broadband and nearly a quarter of Hispanic Internet users don’t own a computer. Meanwhile, nearly seven in 10 Hispanics have a smartphone, and their daily time spent using mobile (3 hours) is more than an hour higher than non-Hispanics.

Digital video is popular among Hispanics, with 47 percent (vs. 32 percent of total respondents) saying they use streaming services such as Netflix more than they watch traditional TV. Additionally, Pew Research Center’s January polling identified 78 percent of Hispanic adults as YouTube viewers, compared to 73 percent of total adults.

Hispanics also tend to be active on social media. Nearly two-thirds use social media, and about half are on Facebook. Data also suggests Hispanics are less likely than others to have a negative view of digital advertising.

With these findings in mind, below are some best practices for credit union leaders to consider for enhancing the Hispanic digital experience.

Opt for speed over complexity. Because many Hispanics don’t have home broadband and likely rely on their smartphone carrier data to access the Internet, make sure your website and digital banking tools aren’t overly complex. Large photos and fancy animations are fun but can be difficult to load on a phone that’s not connected to WiFi.

Adjust advertising budgets. Because Hispanics tend to use digital video and social media more than they watch traditional TV, advertising on places like YouTube, Facebook, and other mobile channels may be a better use of advertising dollars. The average cost of a 30-second primetime television commercial during the 2016-2017 season was $2,500. Think for a minute (or 30 seconds) about how many mobile and social media ads your credit union could deliver with that kind of investment.

As with any Hispanic outreach strategy, the most important thing to keep in mind in your digital transformation journey is that different segments should not be treated as a single, undifferentiated market. Understanding various consumer segments and how they engage digitally is the first step to providing an exceptional consumer experience.

In our last blog post, we shared several stats that reveal how Hispanics in the U.S. are driving America’s economic growth. A recent study by Stanford, Harvard and Census Bureau researchers further confirms this point and signals additional opportunities for credit unions.

The study shows Hispanics are escaping poverty and climbing the economic ladder at nearly the same pace as their white peers.

THE RESEARCH

• Among Hispanics in the U.S. who grew up in the lowest income segment, 45 percent made it to the middle class or even higher, compared to 46 percent of whites.

• Of those who grew up in the lower middle class segment, 28 percent made it to the upper middle class or higher, compared to 35 percent of whites.

Consider how you can help more Hispanic members become homeowners. As Hispanic income grows, so will the ability to buy homes and make other financial investments. In 2017, more than 167,000 Hispanics purchased a first home, taking the total number of Hispanic homeowners to nearly 7.5 million (46.2 percent of Hispanic households). Hispanics are the only demographic to have increased their rate of homeownership for the last three consecutive years. By offering a variety of home loan options supported by culturally relevant education, credit unions can help more Hispanics realize the dream of homeownership.

Offer programs to help Hispanic members save for retirement. A recent survey found 71 percent of middle-income Hispanics feel they are behind on preparing for retirement, compared to 63 percent of the general population. At the same time, many have difficulty securing the financial services that can help them address these issues. The survey found 59 percent are unsure who to go to for financial advice and guidance; 53 percent say it’s difficult to find financial services companies that know how to help households like the ones they belong to; and 42 percent believe they have different financial planning needs than the average household. Fortunately, increasing income mobility will allow Hispanics to start saving for retirement sooner. Consider how your credit union can be the financial services provider many Hispanics are looking for to help with their retirement savings needs.

Partner with high schools and colleges to offer financial education to students. While more Hispanics are attending college, their graduation rates tend to be lower than their white peers. A report by the National Student Clearinghouse Research Center found that 45.8 percent of Hispanic students who entered college in 2010 completed their degree within six years, compared to 62 percent of whites. This disparity could be the result of several different factors, including financial challenges. By offering culturally relevant financial education on topics like budgeting and student loans – as well as encouraging students to establish a relationship with a credit union before or during their college years – you can help more Hispanic students graduate from college and land higher paying jobs.

While the numbers on Hispanic income mobility are encouraging, there is still work to be done. Who better to do it than credit unions?

Anyone curious about the Hispanic community’s contribution to the U.S. economy need not look any further than these stats from the first half of this decade, provided by the Latino Gross Domestic Product (GDP) Report:

• At 2.9 percent, the U.S. Hispanic GDP experienced the third-highest growth rate in the world, behind only China and India. It was nearly 70-percent higher than the non-Hispanic U.S. GDP growth rate of 1.7 percent.

• If it were an independent country, the U.S. Hispanic GDP would be the seventh largest in the world, larger than the GDP of India, Italy, Brazil or Canada.

• While the non-Hispanic U.S. workforce shrank by about 4,000 workers, the Hispanic U.S. workforce grew by nearly 2.5 million, making possible an overall increase of 2.4 million in the U.S. workforce, ages 24 to 64.

• As young Hispanics enter the workforce and older non-Hispanics leave it, the Hispanic GDP will account for an increasing portion of the total U.S. GDP growth, projected to be 24.4 percent of total U.S. GDP growth by 2020.

What do these stats mean for credit unions?

• As the Hispanic community’s impact on the U.S. economy continues to grow, so will its need for financial services. There’s never been a better time for credit unions to start (or grow) a Hispanic membership growth strategy. Those that don’t will find it increasingly difficult to grow their total membership, deposits and loan balances.

• Young Hispanics will be an increasingly important pool of talent as credit unions grow and hire new employees. As college-educated Hispanics continue to enter the workforce at a faster rate than non-Hispanics, it’s important for credit unions to review their recruiting and hiring processes to ensure they are appealing to Hispanics.

• Dispelling myths about Hispanics is a joint effort. Despite the above statistics, some segments of the U.S. population are not aware of the essential role Hispanics play in the success of the domestic economy. Consider ways you might partner with organizations and Hispanic leaders in your community to help tell the story.

In short, the U.S. Hispanic community is growing in number, spending power, education and – for growth-minded credit unions – opportunity.